Example 11: The facts are the same as in Example 9, except that nine months ago, M contributed cash to KLM Partnership equal to the value of his partnership interest at that time. Thus, M’s holding period at the time of the sale of his KLM interest is divided into 50% short-term and 50% long-term.

*MACRS straight-line property on which at least $9,000 of depreciation has been taken.

**Limited to the portion allocable to the percent of the interest held long-term.

***Assumes these are M’s only income and loss items.

****The loss is netted first against 28% gain, then against 25% gain.